The U.S. Securities and Exchange Commission (SEC) has delayed its decision on whether to approve options trading for BlackRock’s iShares Ethereum Trust ETF (ETHA), announcing a new deadline for a final ruling on April 9, 2025. The regulatory body cited the need for more time to assess the proposal, which was originally filed by BlackRock through Nasdaq in August 2024.
This extension puts off the long-awaited decision for market participants eager to trade derivatives tied to Ethereum ETFs. Should the SEC approve the proposal, it would open the door for options trading on the ETHA ETF, offering new avenues for hedging and speculative strategies.
Growing Demand for Crypto ETF Options
The delay comes amid increasing demand for cryptocurrency ETF options, particularly following the success of BlackRock’s Bitcoin ETF (IBIT), which received approval for options trading in September 2024. By November 2024, IBIT options had become one of the most active ETF derivatives markets, with open interest exceeding $13 billion.
The approval of Ethereum ETF options is expected to generate similar interest. BlackRock’s ETHA ETF currently leads the Ethereum ETF market, with $3.7 billion in assets within a sector totaling approximately $9 billion. This growing market could further benefit from the introduction of options trading, increasing liquidity and providing institutional investors with more advanced risk management tools.
Industry Concerns and Public Feedback
While the potential for new investment strategies excites many in the financial world, concerns remain regarding market volatility and the risks posed to retail investors. In response to the proposal, Better Markets, a financial advocacy nonprofit, voiced its caution. Benjamin Schiffrin, Director of Securities Policy at Better Markets, warned that options trading on Ethereum ETFs might expose retail investors to increased risks, noting that “retail investors already lose billions of dollars trading options” and that the proposal could lead to sophisticated investors exploiting these risks.
In addition to BlackRock’s application, the SEC is also considering a similar request from Cboe BZX Exchange on behalf of Fidelity, aiming to list and trade options on its own Ethereum ETF. The SEC has opened the proposal to public comments, with feedback due within 21 days of its publication in the Federal Register.
As regulators continue to scrutinize cryptocurrency financial products, the SEC’s cautious approach to Ethereum ETF options highlights ongoing concerns about investor protection and market stability in the evolving digital asset space.
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